Climate change negotiations stalemate and Copenhagen
Arvind Panagariya in his article in the ET has advocated that India should take a very hard stance at Copenhagen and refuse to accept mitigation obligations. http://economictimes.indiatimes.com/Say-No-at-Copenhagen/articleshow/4809521.cms His point against tariffs on countries that do not introduce caps on carbon emissions is well taken. However, by advocating an intransigence stance he is ignoring the fact that this is not a good negotiation posture. Moreover, this inflexibility and obduracy recommended by him and others based on the argument that ..Rich countries have been responsible for more than 70% of the emissions between 1850 and 2000 and India’s contribution to emissions during these same years was a paltry 2%. Even setting aside this history, Canada, US, Europe, Eurasia and Japan together account for more than 50% of the current emissions and India only 4.4%”… is based on an incomplete understanding of the climate change problem.
Conceptually, the carbon externality problem has a stock aspect and a flow aspect. These are conceptually distinct and require different remedies. The stock problem is to divide (i.e., assign responsibility for) ex-post the noxious cake consisting of the historically given stock of carbon. The flow problem is to devise ways ex-ante to provide appropriate incentives for future emissions. Most of the literature on the carbon problem, including this piece errs in uncritically muddling the two problems.
Once we conceptually seperate the problem and the remedies associated, the developing countries need not be so unyielding and should go tot he bargaining table with an open mind. As has been noted by Prof. Sudhir A. Shah in his (unpublished) review, in positive terms, bargaining theory is the correct framework for analysis of climate change negotiations. In normative terms, a number of axiomatic theories of fair allocation may be relevant. However, the key criterion for the selection of a framework should be whether it is likely to be acceptable to the parties concerned. For instance, there is little point in using a fairness axiom to analyze the problem if the relevant parties are not agreed upon using such a principle. It is easy to predict that Copenhagen will not yield anything other than you vs.us.
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Tags: bargaining, climate change